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Thailand 

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Last Updated: February 2017

Overview


Map of Thailand
Map of Thailand
  • Thailand is an oil and natural gas producer, however, the country increasingly relies on hydrocarbon imports to sustain its rising fuel demand. Domestic crude oil reserves are declining in Thailand, and the country imports a significant share of its total oil consumption. Even though Thailand’s natural gas production has increased substantially in the last two decade, high demand growth and access to imports led the country to become a net importer of natural gas in 2000.
  • Political crises, massive flooding, and indecision on revisions to the Petroleum Act have stalled government incentives in recent years to attract more investment for upstream activities. In addition, lower oil prices since late 2014 have reduced upstream capital expenditure by various state and international energy companies and have led to a reduction in exploration investment. After several delays to a bidding round for 29 oil and gas blocks, Thailand plans to auction key contracts for the Erawan and Bongkot fields held by Chevron and Thailand’s PTTEP by 2018. These contracts expire starting in 2022.
  • Thailand’s Petroleum Act and the Petroleum Income Tax Act enacted in 1971, together with subsequent amendments, provide incentives to concessionaires engaged in upstream activities. However, the government proposed changes to the Petroleum Act to introduce new contract and fiscal terms for oil and natural gas concessions that would allow Thailand’s government to retain greater production revenues. The Petroleum Committee is in the process of finalizing the amendments to the Petroleum Act and is expected to complete the process in 2017.
  • Petroleum and other liquids account for the greatest share of the country’s annual primary energy consumption (40% in 2014), followed closely by natural gas (28%). Thailand is well-endowed with biomass and solid waste resources (representing 19% of primary energy consumption) that are used in both traditional residential uses and in the industrial and power generation sectors. Of total energy consumption, coal accounts for roughly 12% and other renewables, including hydroelectricity, represents 1%, according to the International Energy Agency estimates.

    • Petroleum and other liquids

  • As of December 2016, Thailand held 396 million barrels of proven crude oil reserves, down slightly by 9 million barrels from the prior year, according to the Oil and Gas Journal (OGJ). Most of Thailand's crude oil and condensates are from offshore fields in the Gulf of Thailand.
  • In 2016, Thailand’s petroleum and other liquids production was an estimated 525,000 barrels per day (b/d) about 10,000 b/d higher than a year ago. Crude oil and lease condensates represented about half of the total production, and natural gas plant liquids, biofuels, and refining gains made up the remaining shares. Thailand’s crude oil and condensate production, mostly from offshore in the Gulf of Thailand, has averaged around 240,000 b/d since 2009. Production declines from aging fields is currently being offset by small new developments.
  • State-run PTT Exploration and Production (PTTEP), a subsidiary of PTT Public Company Limited, and Chevron operate several of the country’s largest producing crude oil fields. Independent companies, Ophir Energy (formerly Salamander Energy) and Coastal Energy respectively operate Bualuang and Songkhla, shallow-water crude oil fields, Most of Thailand’s condensate production comes from Chevron’s Erawan and PTT’s Bongkot oil and natural gas fields.
  • Total oil consumption was estimated at nearly 1.3 million b/d in 2016, more than twice the country’s petroleum liquids production. To meet demand and fill the supply gap, Thailand must import a large portion of its petroleum liquids. The country is a net importer of crude oil, with about 62% of the 866,000 b/d of 2016 imports originating from the Middle East, and another 33% are from Asian suppliers, according to tanker data from Lloyd’s Intelligence List. On the other hand, Thailand is a net exporter of petroleum products as a result of its sizeable refining capacity. After supplying the domestic market, oil products, primarily diesel, fuel oil, and jet fuel, are exported to regional markets.
  • Thailand’s refining industry provides for most of the country’s oil product demand. With eight operating refineries, Thailand had the second largest capacity (1.2 million b/d) in Southeast Asia, behind Singapore in 2016, according to FACTS Global Energy. Thai Oil and other refiners plan to expand their capacities over the next several years as a result of higher oil demand.
  • Thailand is the third largest producer of biofuels in Asia, trailing only China and Indonesia, with an output estimated at 45,000 b/d in 2016. The country currently has 21 ethanol plants in operation using molasses and cassava as feedstock. There are a total of 10 biodiesel producers that use variations of palm oil and other feedstock.

    • Natural gas

  • Following a peak in 2006, Thailand’s natural gas reserves have generally declined. As of December 2016, Thailand held 7.3 trillion cubic feet (Tcf) of proved natural gas reserves, according to OGJ. Chevron’s Erawan and PTTEP’s Bongkot fields, located in the Gulf of Thailand, are the country’s largest producing natural gas fields.
  • Chevron, Japan’s Mitsui Oil Exploration Company, Total of France, Shell, and Thailand’s PTT hold sizeable shares in Thailand’s natural gas fields. In addition to private investment, Thailand’s partnership with Malaysia to jointly develop hydrocarbon blocks in the Malay Basin has contributed significantly to Thailand’s natural gas production since 2008.
  • Thailand’s marketed natural gas production increased substantially over the past decade, but it peaked in 2014 at close to 1.5 Tcf. Natural gas output has declined over the past two years, and in 2016, Thailand produced less than 1.4 Tcf, according to Thai government data. The government anticipates an overall decline in output if there are no new discoveries in the next few years. Unless Thailand can attract more exploration investment and replace reserves at a faster rate, it will increasingly rely on natural gas imports.
  • Thailand’s natural gas consumption began to outpace domestic production in 1999 when the country could import natural gas via pipeline from neighboring Burma. Consumption, which reached 1.8 Tcf in 2016, was primarily driven by electric power generation. The industrial sector and natural gas processing plants also consume a significant amount of the country's gas supply.
  • Natural gas imports in the form of liquefied natural gas (LNG), primarily from Qatar, and pipeline gas from neighboring offshore fields in Myanmar were an estimated 460 billion cubic feet (Bcf) in 2016. Thailand commenced LNG imports at its first regasification terminal, the Map Ta Phut LNG, near Bangkok in 2011. Although utilization rates at the terminal have been low in recent years, the first long-term contract with Qatar in early 2015 has raised supplies. Thailand signed long-term agreements with Shell and BP to take LNG from their global portfolios starting in 2017 to correspond with PTT’s doubling of Map Ta Phut’s capacity to 480 billion cubic feet per year (Bcf/y). PTT intends to further expand the terminal to 550 Bcf/y by 2019 and construct a second onshore terminal nearby in Rayong by 2022. Several other regasification terminals are in various stages of planning, but further infrastructure expansion will depend on Thailand’s economic growth and competition with other fuels.
  • Thailand’s natural gas transmission infrastructure is extensive, and the national gas pipeline system connects onshore and offshore gas fields to several gas separation plants, power plants, and hundreds of industrial users.

    • Electricity

  • Thailand generated 180 terawatt hours (TWh) and imported 20 TWh of coal-fired power and hydroelectricity from Laos and Malaysia in 2016, according to Thailand’s Energy Policy and Planning Office (EPPO). Fossil fuels, particularly natural gas, meet most of Thailand’s power requirements. Natural gas-fired generation consisted of 63% of the total electricity supplied, followed by coal and lignite as the second largest feedstock with a 19% share. Thailand's renewable power generation stems from biomass and waste, hydroelectricity, and solar. Combined, renewables account for 8% of the country’s electricity supply, not including hydroelectricity imports.
  • Thailand increased its electricity imports over the past two years following the commissioning of the Hongsa coal-fired plant in Laos in early 2015. Imports accounted for 10% of Thailand’s power supply in 2016.
  • Despite environmental concerns and public opposition to coal-fired power, the Thai government plans to increase coal-fired generation as a means to reduce dependency on natural gas imports for electricity generation. Thailand has also emphasized a growing share of renewables to contribute to the country’s long-term power generation.